Gold Fields Response to Reports Linking Tax Practices by International Mining Companies
Gold Fields’ response to reports linking tax practices by international mining companies in Ghana with negative impacts on development and the environment
12 July 2010
Business & Human Rights Resource Centre invited Gold Fields to respond to the following reports:
-“Unrestrained Consumption - on Africa's Expense” DanWatch, April 2010
-“Golden Profits on Ghana’s Expense - An example of incoherence in EU policy.” DanWatch and Concord Danmark, May 2010
Gold Fields sent the following statement to the Resource Centre:
Gold Fields Ghana (GFG) is not cited in the DanWatch report as one of the mining companies in the country engaged in “aggressive tax planning”. By implication though, the report suggests that other companies are engaged in similar practices. For the record we have listed a number of our contributions to the Ghanaian economy since 1993, when the company acquired the almost defunct State Gold Mining Corporation’s underground mine at Tarkwa.
Our contributions as the country’s leading gold producer (687,020oz in 2009) over the last five years are as follows:
Taxes
- Total direct taxes of over US$250m (2000-2009), which equates to about 5% of Ghana’s direct tax receipt. In addition we have paid royalties of over US$140million over the period.
- Received Platinum Award from the Government of Ghana in 2008 as the leading corporate tax payer in the country.
- Unlike other miners Gold Fields Ghana does not have a so-called stability agreement in place which provides taxation incentives for development of mines.
Economy
- The company’s exports of gold – about 35% of all gold exports from the country – account for 13% of the country’s foreign exchange earnings. Over 60% of export earnings are returned back to Ghana.
- GFG’s operations employ about 7000 Ghanaians with a six times multiplier effects.
- The company is committed to local entrepreneurship development. Currently about 25% of contracts are held by local Ghanaian company with approximately 60% held by multi-national service providers with significant local representation.
Social investment
- A yearly social investment of US$2million through the Gold Fields Ghana Foundation. This investment, which has occurred every year since 2002, has resulted in significant improvements in education delivery, health facilities, portable water and agriculture among neighbouring communities at our two mines.
- Education: 33 School blocks built; 8 Teachers Quarters; 4 ICT Centres. Over 300 students studying at secondary, vocational and tertiary levels on full GFG scholarships
- Over 14 communities which are close to GFG’s operations have access to electricity and potable water through the support of the company.
- Support of small to medium-sized enterprises as well as establishment of fish and palm oil farms in areas surrounding our mines.
- Sponsorship of over US$7million to Ghana’s senior national soccer team, the Black Stars, since 2005. This has helped the team do very well in the last two World Cups (2006, 2010) and the African Nation Cup (2010) and has had a positive impact on the international reputation and the self-confidence of the nation. It also allowed the Ghana Football Association to promote development of soccer around the country.